Special to The Washington Post
Even if you have no plans to buy or sell your house, you’ve probably peeked at your Zestimate – Zillow’s estimated market value of more than 100 million homes in the U.S. And you probably know your neighbors’ Zestimates, too.
Zillow bases these mysterious numbers on an algorithm that takes information from public records and weighs each piece of data based on current market trends in your area. The numbers are recalculated at least three times a week, and you can even view a chart of your home’s Zestimate history (and how it compares to the average Zestimates in your zip code) for the past 10 years. Looking up your home’s Zestimate can either make you feel proud or angry.
So, how accurate is your Zestimate?
While reporting a story for The Post’s Real Estate cover this week, I quickly learned that the Zestimate is somewhat controversial in the real estate world – and not only with the folks who complain about their home’s low number. Some agents, homebuyers and homeowners say it’s a very helpful tool, but others say the home value figures can be misleading and people shouldn’t etch that number in stone when it comes to making an offer or pricing your home.
Zestimates tend to be more accurate in neighborhoods with frequent turnover, which provides a constant stream of information about home sales. Real estate agents say that the Zestimates seem to be least accurate in neighborhoods where many of the homes haven’t changed hands for 20 or 30 years and it’s tough to know how much each house has been renovated?over time, which also impacts home values.
Zillow says that the D.C. area’s Zestimates tend to be some of the best: When the company compared its Zestimates to the actual sales prices throughout the country, it gave the Washington area its top four-star rating (Cincinnati and Kansas City, on the other hand, only get one star; Tampa and St. Louis get two stars).
“In the D.C. metro area, almost three-quarters of the Zestimates are within 10 percent of the eventual sale price,” says Cynthia Nowak, a Zillow spokeswoman. “Data plays heavily into accuracy. In the D.C. area, there are ample public records, which helps us provide more accurate Zestimates. In some places, data about home sales is not available publicly. That results in a one-star rating, which means we can’t compute Zestimate accuracy.”
Still, there can be a big range in Zestimates depending on where you live and what’s happened to home sales in that area.
Have you looked up your Zestimate recently? How accurate did you think it was? And if you bought or sold a house, how did the Zestimate compare to the actual sales price?
Related: Guide to five real estate web sites
Kim Lankford is a freelance writer.